Physician employment contracts are legally binding agreements, and since they can be quite complicated to understand, it’s important to conduct a thorough contract review before signing one.
Hiring a contract review lawyer is always the best approach, as they will be able to determine if the agreement is fair to the physician and be able to identify any important information that might be missing.
Whether you’re about to sign your first physician contract, renew an agreement, or make changes to an existing one, here are the five benefits of conducting regular contract reviews.
- Fair Compensation
One of the most important sections of an employment contract is the compensation clause. From your salary to the compensation model to any productivity bonuses or signing bonuses you may receive, a contract should clearly specify how much you’ll earn, plus how and when you’ll earn it.
Benefits, such as PTO, health insurance, and contributions to 401k retirement accounts, are also considered part of compensation. If any of those benefits are missing, you won’t receive them. A review is your chance to confirm that you’ll be receiving all of the salary and benefits you deserve.
This article goes into greater detail regarding other types of benefits your physician contract might include.
- Reasonable Employment Terms
Physician contracts also detail responsibilities, duties, and the hours you’ll work, including any on-call hours you may need to do.
During review, pay special attention to your duties, obligations, and when and where you’re expected to perform them. For example, if you expect to only do one on-call shift per month, make sure the contract says that. When signing a locum tenens agreement for a temporary position, confirm that the specific location of that position is in the details.
- Fair Termination Clause
Termination clauses dictate what will happen when your employment ends, and there are three key elements to pay attention to:
- With or without cause termination
- Restrictive covenants
- Financial obligations
Your contract should specify if your employer can terminate your employment with cause or without cause. With cause means there must be a just reason for letting you go. Without cause means that the employer can fire you at any time for any reason, or for no real reason at all.
Restrictive covenants can be quite problematic for physicians, as they often include non-compete clauses that put limitations on where you can work when your current employment ends. Contract review is the time to ensure that all non-compete clauses are reasonable and that they won’t put unfair restrictions on your future employment opportunities.
A termination clause can put your finances on the hook in another way as well. Sometimes they require you to repay signing bonuses, pay back relocation costs, or purchase tail coverage on a malpractice insurance policy.
With a thorough review you can protect your finances while you’re on the job and when your employment comes to an end.
- Partnership Opportunities
Do you aspire in future years to buy in as a partner in a group practice?
Then your contract should include the details of partnership opportunities.
It should clearly spell out what is required of you should you choose to become a partner, how many years you must work before you can buy in, and what the cost of your buy-in will be.
Should any of these details be missing, your opportunity for future partnership could be in jeopardy.
- Identify Opportunities for Negotiation
Keep in mind that every contract is negotiable, but only up until the point at which you sign it.
Various contractual obligations can be negotiated, but it’s unreasonable to think you’ll be able to negotiate every aspect in your favor. The more experienced and the more in-demand you are, the more leverage you have, but most employers will hold firm on some terms and be more flexible on others.
For example, you might be able to negotiate for a slightly bigger signing bonus or for a few more paid days off per year, but the employer may not budge on termination clauses or on-call responsibilities.
Hiring a contract review lawyer can help you identify which terms you can negotiate or if any clauses are missing that, if added in, could make the agreement more favorable to you as the employee.
In Conclusion
Without a contract review you could be short changing yourself in terms of salary, missing out on benefits you deserve, or putting your future employment opportunities at risk. The next time you’re presented with an employment agreement, take the time to perform a thorough review. The benefits are far too great to ignore.